Silicon Valley is home to some of the most powerful technology companies in the world. Microsoft, Google, Apple, Intel, Sony, IBM and Oracle all headquarter in and around the Silicon Valley, and many of those companies started and built their company there. With so many technology companies headquartered in the area, it makes sense that Vodafone (London, England) decided to launch a Research and Development (R&D) Center in that same location.

The Vodafone Xone R&D Center will aim to bring in new technology from startup companies, universities and venture capital portfolios, according to the company.

“Being on the ground floor for finding and nurturing these types of companies is important for Vodafone,” says Steve Hilton, principal analyst for Analysys Mason. “Xone is going to be measured on the number of excellent new products it brings to proof of concept”

Vodafone’s Xone center can hold up to 24 companies in its test space and includes such capabilities as 2G/3G/LTE radios and an Internet Protocol (IP) network, which can access the IP service framework and IP Multimedia Subsystem, according to Vodafone. The lab is also interconnected via a backbone to Vodafone’s European networks, and is closely aligned with Verizon’s Centers in San Francisco, Calif., U.S.A. and Waltham, Mass., U.S.A. giving select companies’ access to Verizon Wireless’s 4G LTE network.

Vodafone owns 45% of Verizon Wireless, which is the largest telecom operator in the United States. But if Vodafone already has a relatively strong presence in the U.S., why did the company decide to build a R&D center in the Silicon Valley?

“[Vodafone] obviously wanted more direct involvement in the R&D of solution from U.S.-based start-ups,” said Hilton. “As a partial owner of Verizon Wireless, Vodafone will continue to work with Verizon in a host of areas.”

With its own D&R center in Silicon Valley, the company opens itself up to grow in a number of sectors, including the M2M industry.

“Vodafone is one of the largest M2M carriers in the world in terms of M2M device connections,” says Hilton. “They are strongly invested in M2M and all signs point to heightened investment.”

Vodafone isn’t the only European telecom provider who recently invested in the U.S. market. Telenor (Stockholm, Sweden), recently hired a head of business development in the U.S. with plans of expansion in the near future.

“I think we're going to see more of this type of U.S. investment by European companies,” says Hilton. “If for no other reason that exchange rates make it pretty attractive.”